4 Ways to Reduce Inventory Replenishment Time to Increase Sales and Profits
3. Manage by exception. The 80/20 rule is nearly always true. The top 20 percent of your problem items will typically address 80 percent of your inventory problems. Your time is a fixed constraint. The faster you can review and address the biggest problem items, the greater impact you'll have on improving sales, gross margin and cash flow. It’s fairly simple to provide product-level exception reports ranking your highest under- and over-bought items to focus your time on the most important areas.
4. Decide before the weekend. Whenever possible, make decisions before a weekend. Suppliers and freight companies work on your weekend. Waiting to make a decision until Monday can inhibit your ability to cancel a purchase order, expedite delivery or obtain supplier acceptance of your order. What seems like waiting one day, from Friday to Monday, can translate to weeks of delivery time.
These are all fairly simple processes, but given the importance of inventory to sales and profits, their benefit to your business can be huge.
Joe is Vice President of Product Solutions at Software Paradigms International (SPI), an award-winning provider of technology solutions, including merchandise planning applications, mobile applications, eCommerce development and hosting and integration services, to retailers for more than 20 years.
Joe is a 34-year veteran of the retail industry with hands-on experience in marketing, merchandising, inventory management and business development at multichannel retail companies including Lands’ End, LifeSketch.com, Nordstrom.com and Duluth Trading Company. At SPI, Joe uses his experience to help customers and prospects understand how to improve sales and profits through applying industry best practices in merchandise planning and inventory management systems and processes.